Under which of the following economy the consumer have limited freedom of choice
Options
ASocialist
BMixed
CCapital
DRestricted
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Introduction to Business EconomicsPYQ Jun 23Question 767 of 209
All Questions Correct Answer
✅ Option a — Socialist
All Options:
- ASocialist
- BMixed
- CCapital
- DRestricted
Detailed Solution & Explanation
To determine the correct answer, let's analyze the concept of economic systems and their impact on consumer choice.
• In a socialist economy, the means of production are owned and controlled by the state, which often leads to a limited variety of goods and services available to consumers.
• This limited availability of goods and services restricts the freedom of choice for consumers, as they have to choose from a narrow range of options.
• The correct answer is based on the principle that socialist economies often prioritize social welfare and equality over individual freedom and choice.
The incorrect options can be eliminated because:
• A capitalist economy is characterized by private ownership and free market principles, which typically provide consumers with a wide range of choices.
• A mixed economy combines elements of both socialist and capitalist systems, but still offers more freedom of choice compared to a socialist economy.
This is in line with the definition of economic systems and their effects on consumer behavior, as described in business economics theories.
About This Chapter: Introduction to Business Economics
Paper
Paper 4: Business Economics
Weightage
5%
Key Topics
Meaning, Scope, Price Mechanism
This chapter lays the groundwork for understanding Business Economics as a discipline. It covers the meaning, scope, and nature of economics — including key distinctions like Microeconomics vs Macroeconomics, Positive vs Normative economics, and the fundamental economic problem of scarcity. Students learn how businesses use economic principles for decision-making in a competitive marketplace.
View Official ICAI SyllabusExam Strategy Tip
Focus on definitions and distinctions between concepts. Questions often test whether you understand the difference between Micro and Macro, or Positive and Normative statements.
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